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Retirement Eligibility Calculating Final Average Salary Calculating Retirement Estimates How to Retire Retirement Date and End Date: Non-School Retirement Date and End Date: School Pay Reporting Who Is a Licensed School Employee? Retirement Payment Options Certifications Retirement Checklist End Dates Certifications Cheat Sheet: Summer Retirements for Schools 1 8/19 GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement CONTENTS QUICK VIDS & MORE EMPLOYER MANUAL Retirement - KPERS 1 Avoid Common Problems Ounce of Prevention Your retiring employees have worked long and hard to get to this point. Together let’s strive to make the retirement process rewarding and honor their public service with our efforts. The Retirement Info Center on kpers.org is the resource for members within 5 years of retirement. Find answers to the when, how-much and how-to questions, and a lot more. Retirement Eligibility Members are eligible for full unreduced retirement benefits if they meet one of the following requirements: Age Service credit Points At least 65 1 year (2 or more quarters)* n/a At least 62 10 years (38 or more quarters)* n/a Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age to years of service 53 current age +28 current years of service 81 current points 2. Subtract current points from 85 85 pts needed for unreduced retirement benefits -81 current points 4 points needed 3. Divide points by 2 4 points needed +2 every yr adds 1yr service & 1yr age = 2 points 2 years to go before eligible under 85-point rule Members are eligible to receive reduced retirement benefits if they are between ages 55 and 62 and have at least 10 years of service. If a member is between ages 60 and 62, his or her reduction factor is 0.2 percentage points for each month he or she is under age 62. If a member is between ages 55 and 60, his or her reduction factor is 0.6 percentage points for each month he or she is under age 60.

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Page 1: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

1 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Your retiring employees have worked long and hard to get to this point. Together let’s strive to make the retirement process rewarding and honor their public service with our efforts.

The Retirement Info Center on kpers.org is the resource for members within 5 years of retirement. Find answers to the when, how-much and how-to questions, and a lot more.

Retirement EligibilityMembers are eligible for full unreduced retirement benefits if they meet one of the following requirements:

Age Service credit Points

At least 65 1 year (2 or more quarters)* n/a

At least 62 10 years (38 or more quarters)* n/a

Any +Any = 85 or more

* two quarters round up to one year; 38 quarters round up to 10 years

How to calculate 85 points (example)

1. Add employee’s age to years of service

53 current age

+28 current years of service

81 current points

2. Subtract current points from 85

85 pts needed for unreduced retirement benefits

-81 current points

4 points needed

3. Divide points by 24 points needed

+2 every yr adds 1yr service & 1yr age = 2 points

2 years to go before eligible under 85-point rule

Members are eligible to receive reduced retirement benefits if they are between ages 55 and 62 and have at least 10 years of service.

• If a member is between ages 60 and 62, his or her reduction factor is 0.2 percentage points for each month he or she is under age 62.

• If a member is between ages 55 and 60, his or her reduction factor is 0.6 percentage points for each month he or she is under age 60.

Page 2: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

2 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Reduced benefits based on $1,500 benefit

Age Estimated reduced benefit Reduction

62 $1,500/mo (max) 0%

60 $1,425/mo 5%

55 $885/mo 41%

KPERS Correctional Officers retirement eligibility

Full

reti

rem

ent

elig

ibili

ty Gro

up A

Age 55 with 3 years of service or Age and years of service equal 85 pts

If Group A Correctional Officer retires at age 55 with 3 years, employee must be a Group A Correctional Officer at least 3 years immediately before retirement and retire on the first day of the month after the last day on the payroll.

Gro

up B

Age 60 with 3 years of service or Age and years of service equal 85 points.

If Group B Correctional Officer retires at age 60 with 3 years, employee must be a Group B Correctional Officer at least 3 years immediately before retirement and retire on the first day of the month after the last day on the payroll.

Earl

y re

tire

men

t el

igib

ility

Gro

up A

Age 50 with 10 years of service

Must be a Group A Correctional Officer at least 3 years immediately before retirement and retire on the first day of the month after the last day on the payroll.

Gro

up B

Age 55 with10 years of service

Must be a Group B Correctional Officer at least 3 years immediately before retirement and retire on the first day of the month after the last day on the payroll.

Portability of service If a member has service in more than one of the plans administered by the Retirement System, they can combine service to vest and to meet retirement eligibility in KPERS. This “portability” should not be confused with portability of group life insurance. They can also usually combine service credit for retirement eligibility. Contact KPERS with questions.

Calculating Final Average SalaryRetirement benefits are calculated using a formula set by state statute. When a KPERS-covered employee retires, the formula takes into account the following:

• The employee’s final average salary• A statutory multiplier• The employee’s years of service

Page 3: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

3 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Final average salary x statutory multiplier x years of service = annual benefit

$30,000 x 1.75% x 20 = $10,500

$30,000 x 1.85% x 10 = $5,550

$30,000 x *both x 30 = $16,050

*1.75% for service before 2014; 1.85% for participating service January 2014 and after

If an employee’s membership date is on or after July 1, 1993, his or her final average salary is:

A three-year salary average excluding additional compensation.* This three-year average is based on the employee’s three highest years of pay during his or her career. They do not have to be continuous years.

If an employee’s membership date is before July 1, 1993, or the employee was in his or her “year of service” waiting for membership before July 1, 1993, the final average salary is the higher of:

• A three-year salary average excluding additional compensation.* This three-year average is based on the employee’s three highest years of pay during his or her career. They do not have to be continuous years.

• A four-year salary average including additional compensation.* This four-year average is based on the employee’s four highest years of pay during his or her career. They do not have to be continuous years.

Compensation considered “add-on”

Compensation an employer pays the employee at retirement in a lump-sum for unused sick leave, annual leave, comp-time, holiday leave payout, kelly days, PTO, wellness days and longevity. Add-on compensation is paid only at retirement.

*Add-on payKPERS cannot use an early retirement incentive or severance pay as part of add-on pay when calculating the final average salary. School employees have special guidelines.

KPERS will calculate both options and use whichever is higher to calculate the employee’s retirement benefit. If add-on pay is included in final average salary, it is spread over all the days the employee worked in the calendar year he or she retired. It is not credited only to the quarter in which he or she left employment.

Membership date on July 1, 1993, or after, or any agency to affliate in KPERS after January 1, 1994

The member may not use their add-on pay (compensation the employer pays the employee in a lump-sum for unused sick leave, annual leave, comp-time, holiday pay).

Page 4: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

4 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Final average salary “Spike law”

The “Spike Law” places the actuarial liability for certain payments on the participating employer. According to K.S.A. 74-49,126, employers are responsible when add-on payments for accumulated sick leave, vacation or annual leave, etc. increase the member’s final average salary by more than 15%.

The employer must pay the Retirement System a lump-sum amount equal to the actuarial liability for benefits attributable to and payable on account of the excess payments over the 15%.

Final average salary “Cap law”

K.S.A. 74-4902(9) states that if a member’s compensation used in calculating his or her final average salary is more than 15% higher than the preceding year, the amount which exceeds the 15% will not be included in compensation.

Compensation that is capped:

• Part-time members who stay in the same position and whose salary is over the 15% because they work more hours (not overtime hours)

• Raises• Bonuses• Extra duties, teaching extra classes• Longetivity if paid yearly

Note: members with membership dates July 1, 1993, and after do not have add-ons included in their final average salary because this type of compensation should not be reported to KPERS.

Compensation that is not capped

• Compensation for “add-ons” paid to members if their membership date is before July 1, 1993, and a four-year final average salary is used in their retirement calculation.

• Any increase in compensation for any member due to reclassification or reallocation to a higher range or level

• Overtime

Calculating Retirement EstimatesRequesting an estimate from KPERS

• A retirement estimate is calculated the same way as an actual retirement benefit.

• A retirement estimate may use projected salary information.

• The KPERS office requires a Retirement Benefit Estimate Request form (KPERS-15E) for all estimate requests. Processing will take approximately four weeks.

• If you are requesting the estimate, the designated agent will need to sign the estimate request form.

• If the member is requesting the estimate, the member will need to sign the estimate request form.

Page 5: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

5 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

• In the event of a discrepancy between an estimate and the actual monthly benefit, the benefit received will be paid in accordance with applicable laws and regulations.

• To calculate the actual retirement benefit we will use salary information reported on the retirement certification (completed by employer).

Try our KPERS 1 online calculator. Just fill in the information and receive a benefit estimate. And remind employees they can estimate their benefits at any time using their online account.

How to RetireCompleting retirement application

When a member retires, he or she must do the following:

• Submit a retirement application 30 to 60 days before the member’s retirement date.

• From the KPERS forms page, click on the Application for Retirement Booklet (KPERS-15 Booklet). Click to order a supply of printed retirement applications.

Documents needed for retirement

Member

• A photocopy of the member’s birth document

• A photocopy of member’s name change document if name is different than name on birth document.

Joint annuitant

• A photocopy of the joint annuitant’s birth document.

• A photocopy of the joint annuitant’s name change document if name is different than name on birth document.

Page 6: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

6 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Acceptable proof of birth

A photocopy of one of the following:

• Marriage or other court records showing birth name and present name (If a person has had more than one name change, records submitted must reflect all name changes.)

• Name Change Affidavit (KPERS-40NC) or other affidavit from a parent listing all name changes

• Request for Member Information Change form (KPERS-12) signed and submitted to KPERS by designated agent at the time of the name change will be acceptable for name changes occurring during employment at the time of the name change will be acceptable for name changes occurring during employment.

• Federal Employment Eligibility Verification form (I-9)

• Driver’s License

• Social Security card

If unable to provide proof of birth with any of the above, submit photocopies of two of the following:

• Military record

• Passport

• School record, certified by the custodian of the record

• Vaccination record, certified by the custodian of the record

• Insurance policy application that shows the age or date of birth

• Marriage records showing date of birth or age (application for marriage license or church record, certified by the custodian of the record or marriage certificate)

• Other evidence such as signed statements from persons who have knowledge of the date of birth

Acceptable proof of name change

A photocopy of one of the following:

• Marriage or other court records showing birth name and present name (If a person has had more than one name change, records submitted must reflect all name changes.)

• Name Change Affidavit (KPERS-40NC) or other affidavit from a parent listing all name changes

• Request for Member Information Change form (KPERS-12) signed and submitted to KPERS by designated agent at the time of the name change will be acceptable for name changes occurring during employment at the time of the name change will be acceptable for name changes occurring during employment

• Federal Employment Eligibility Verification form (I-9)

• Driver’s License

• Social Security card

Page 7: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

7 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Request for Member Information Change form (KPERS-12) signed and submitted to KPERS by designated agent at the time of the name change will be acceptable for name changes occurring during employment.

If unable to provide proof of birth with any of the above, submit photocopies of two of the following:

• Name Change Affidavit (KPERS-40NC) or other affidavit from two persons declaring that the persons have known the applicant by all names in question

• Birth documents of natural child if document shows both the given name and the married name

• Other documents showing both names in question, such as school records, medical records, insurance policy application, etc.

Retirement Date and End Date: Non-SchoolNon-school retirement date

Non-school members may retire the first of any month after their last day on payroll. KPERS must receive the member’s retirement application at least 30 days before their retirement date. Ideally, encourage members to submit their application 60 to 90 days ahead of time. This gives KPERS’ staff time to process the applications with the required documents and time for you to certify member pay.

Example: Kim submits her retirement application in early April. Her last day on the payroll is May 25. The retirement date she selects is the first of the following month, June 1. Kim could also retire the first of any month June 1 or after.

Non-school end date

On the retirement certification, enter the employee’s last day on payroll as the end date.

Retirement Date and End Date: SchoolSchool non-licensed employees

Non-licensed employees may retire the first of any month after their last day on payroll. KPERS must receive the member’s retirement application at least 30 days before their retirement date. Ideally, encourage members to submit their application 60 to 90 days ahead of time. This gives KPERS’ staff time to process the applications with the required documents and time for you to certify member pay.

School licensed employees (including teachers at community colleges)

Licensed employees have special guidelines for selecting a retirement date. School members under the “Continuing Contract Law” must wait until June 1 or after to retire.

If licensed employees choose to retire June 1, they must complete all work on their contract before June 1. Even if your employer’s second quarter does not end until after June 1, you cannot report salary past May 31 if the employee selects a June 1 retirement date. He or she cannot retire June 1 if working any part of June.

Page 8: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

8 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Note: Employers must pay all compensation owed to the employees by the first payroll date after their selected retirement date.

Pay ReportingNon-school members and non-licensed school employees

• Employees may use pay earned through their last day at work as part of their final average salary.

• If an employee’s membership date is before July 1, 1993, deduct KPERS contributions from lump-sum payouts for unused sick leave, vacation leave and compensatory time. KPERS may include payouts in the employee’s final average salary. If hired on or after July 1, 1993, deduct KPERS contributions from lump-sum payouts for compensatory time.

Licensed school employees (including teachers at community colleges)

Whether you deduct KPERS contributions from pay and lump-sum payouts depend on the contract end date and the retirement date.

Retirement date

Contract end date

Reporting contributions

June 1

June 30

• Deduct KPERS contributions from all pay through May 31.• Do not deduct KPERS contributions from employee’s June pay.• Do not deduct KPERS contributions from any lump-sum payouts.

KPERS will calculate a 3-year final average salary.

July 31

• Deduct KPERS contributions from all pay through May 31.• Do not deduct KPERS from the employee’s June and July pay.• Do not deduct KPERS contributions from any lump-sum payouts.

KPERS will calculate a 3-year final average salary.

August 31

• Deduct KPERS contributions from all pay through May 31.• Do not deduct KPERS from the employee’s June, July and August pay.• Do not deduct KPERS contributions from any lump-sum payouts.

KPERS will calculate a 3-year final average salary.

Page 9: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

9 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

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EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Retirement date

Contract end date

Reporting contributions

July 1

June 30

• Deduct KPERS contributions from all pay through June 30.• If membership date is before July 1, 1993, deduct KPERS

contributions from lump-sum payouts for unused sick leave, vacation leave and/or compensatory time.

• If membership date is on or after July 1, 1993, deduct KPERS con-tributions deduct KPERS contributions from lump-sum payouts for compensatory time.

July 31

• Deduct KPERS contributions from all pay through June 30. • Do not deduct KPERS contributions from the employee’s July pay.• Do not deduct KPERS contributions from any lump-sum payouts.

KPERS will calculate a 3-year final average salary.

August 31

• Deduct KPERS contributions from all pay through June 30.• Do not deduct KPERS from the employee’s July and August pay.• Do not deduct KPERS contributions from any lump-sum payouts.

KPERS will calculate a 3-year final average salary.

August 1

July 31

• Deduct KPERS contributions from all pay through July 31.• If membership date is before July 1, 1993, deduct KPERS

contributions from lump-sum payouts for unused sick leave, vacation leave and/or compensatory time.

• If membership date is on or after July 1, 1993, deduct KPERS con-tributions deduct KPERS contributions from lump-sum payouts for compensatory time.

August 31

• Deduct KPERS contributions from all pay through July 31. • Do not deduct KPERS contributions from the employee’s August

pay. • Do not deduct KPERS contributions from any lump-sum payouts.

KPERS will calculate a three-year final average salary.

September 1 August 31

• Deduct KPERS contributions from all pay through August 31. • If membership date is before July 1, 1993, deduct KPERS

contributions from lump-sum payouts for unused sick leave, vacation leave and/or compensatory time.

• If membership date is on or after July 1, 1993, deduct KPERS con-tributions deduct KPERS contributions from lump-sum payouts for compensatory time.

Note: Current statutes provide freedom in how you write contracts for your employees.

However, K.S.A. 74-4940 states that compensation must be paid in 12 equal monthly installments when reporting to KPERS.

Cheat Sheet: Summer Pay for Retiring School Employees

Page 10: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

10 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

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EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Reminder Do not deduct KPERS contributions from any early retirement incentives or severance payments.

Early retirement incentive: a bonus paid to all retiring employees because of their pending retirement

Lump-sum payouts: compensation above regular pay for unused leave balances that could include sick leave, vacation leave, annual leave, compensatory time, etc.

School nine- or 10-month employee

• If a 9-month or 10-month employee has previously been paid in 12 monthly checks and elects to take a payout at the end of May for the balance earned, the final average salary is subject to the 15% cap law for KPERS 1 members and 7.5% for KPERS 2 members.

• If a 9-month or 10-month employee has previously been paid in 12 monthly checks and does not elect to be paid for the balance earned in May, the employee must wait to retire until all wages have been paid (including all summer pay).

• Please designate on the employer certification if employee was paid over 9, 10, or 12 months in previous years.

Community colleges

All teachers employed at community colleges are covered by the “Continuing Contract Law.” Please refer to the licensed employees section when helping an employee select a retirement date.

Breaking school contracts

If licensed employees retire before the end of the school year, the following applies:

• When reporting compensation, KPERS can only accept a prorated contribution amount based on the number of days of service in the last month.

• Do not report additional pay such as sick leave, vacation leave, etc.• Do not give daily per diem or daily rates of pay.

For example:

Teacher’s last day is March 10. The teacher’s school contract is $48,000. Report 1/12 of the contract amount for each month in the calendar year through February $48,000/12 = $4,000.

Compensation Contributions

January $4,000 $240 (6%)$4,000/31 (days in March) = $129.03

x10 days of service = $1,290.30February $4,000 $240 (6%)

March $1,290.30 $77.42 (6%)

Page 11: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

11 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

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EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Who Is a Licensed School Employee?Board of Education’s list of licensed employees

• Educator (teacher, administrator)• Audiologist• Speech pathologist • Occupational therapists• Physical therapist • Social worker• Registered nurse • Dietitian • Licensed clinical professional counselor • Licensed professional counselor • Psychologist • Orientation and mobility instructor

Retirement Payment OptionsMaximum monthly benefit

KPERS will calculate the member’s maximum monthly benefit amount. This amount will provide a basis for the rest of the options. The member may choose the maximum monthly benefit amount without any additional options. The member will receive a payment each month for the member’s entire lifetime. When the member dies, there is no continued benefit to a joint survivor. The member’s beneficiary will receive any remaining account balance that has not been paid out in benefits.

Joint-survivor options

Joint-survivor options

Member retirement benefit

If member dies first, beneficiary receives

1/2maximum benefit (adjusted for age

difference)

50% of member’s reduced benefit for life

3/4 75% of member’s reduced benefit for life

Same 100% of member’s reduced benefit for life

Members cannot change the retirement option after he or she retires.

Pop-up feature

On all the joint-survivor options, if the joint survivor dies before the member dies, the retirement option chosen is canceled. The member’s benefit will increase to the original maximum monthly benefit amount. This is called the “pop-up feature.” The member cannot choose someone else to continue to receive a monthly benefit after their death.

Life-certain options

Page 12: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

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EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

With a life-certain option, the member will receive a reduced benefit for the rest of his or her lifetime. If the member dies within a guaranteed period of time from his or her retirement date, the beneficiary will receive the same monthly benefit for the rest of the guaranteed period of time.

The member can change his or her beneficiary at any time, and the member can have more than one beneficiary. The named beneficiaries will share equally the benefit for the remaining time period.

Option Percentage of max. benefit The longer the guaranteed period

the more the member’s benefit is reduced to pay for the continuing benefit.

5-year life-certain option 98%

10-year life-certain option 95%

15-year life-certain option 88%

Mary’s maximum monthly benefit is $1,000.

Mary’s chooses 10-year life certain option at 95%.

Mary’s monthly benefit is now $950/mo. as long as she lives.

Mary dies seven (7) years after retirement.

Mary’s beneficiary then receives $950/mo. for 3 years.

Mary’s 7 years + beneficiary’s 3 years = 10 years guaranteed

Partial lump-sum option (PLSO)

The partial lump-sum option is available in 10%, 20%, 30%, 40% or 50% amounts. The percentage the member selects determines the size of the lump sum and the resulting decrease in the member’s monthly benefit amount.

For example, a 40% PLSO payment would result in a single lump-sum payment equal to 40% of the actuarial present value of the member’s lifetime benefit, along with a permanent 40% reduction in the member’s regular monthly benefit.

Spousal consent

If the member has chosen the maximum option, one of the life-certain options or the partial lump-sum option, the spouse must complete the spousal consent section of the retirement application. This verifies that the spouse has read, understands and agrees with the retirement option that the member has chosen. The spouse’s signature must be notarized.

Qualified domestic relations order (QDRO)

In the event a Retirement System member divorces, any annuity, benefit, or accumulated contributions from the Retirement System may be subject to claims by a

Page 13: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

13 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

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EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

former spouse under the provisions of a qualified domestic relations order (QDRO).

A QDRO is a court order providing for:

• Maintenance. • Child support. • Property division.

Retirement account assets are considered marital assets to the extent they have accumulated during the marriage. Most QDROs result from an agreement between the parties. A former spouse may not receive payment from the Retirement System under a QDRO unless and until the member:

• Retires - If the member becomes eligible to retire with monthly benefits, the former spouse may be awarded either a lump-sum distribution or a percent of each monthly benefit.

• Withdraws - If the member ends employment and withdraws his/her contributions, the former spouse may be awarded a portion of the lump-sum distribution.

• Dies - If a member dies before retirement, the former spouse’s award may be enforceable against the refund of accumulated contributions or the lump-sum death benefit.

Retired members: The QDRO in the proper form may become effective immediately, resulting in the division of the member’s benefits.

CertificationsCheck your EWP To-Do list for certification

When KPERS receives an application for retirement, we will require a last day on payroll and certified contributions for that member. You will receive a request on your EWP To-Do list and under Certifications, asking you to report pay info for the employee who is retiring. Quick Vid: Certifications

Retirement ChecklistAfter an employee has decided to retire, use this quick reference checklist to help you get through the final steps without missing a beat.

Have the employee get a retirement benefit estimate• Direct employee to calculator on his or her online KPERS account

Enter employee’s end date on the EWP as soon as you know it (up to 90 days ahead)• End date must be earlier than retirement date Quick Vid: End Date

Page 14: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

14 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

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EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

Give or point employee to the Applications for Retirement Benefits, Related Forms and Information (KPERS-15 Booklet)• Booklet has application, instructions, tax info, as well as forms for

withholding, direct-deposit and designation of beneficiary• Employee should submit application at least 30 days (encourage 60 to 90

days) before retirement date• KPERS will process application and may send you a request to certify final pay

Give life insurance conversion and portability forms to employee The Standard Conversion Packet The Standard Life Portability Insurance Application

• Kansas law requires that you give employees notice of life insurance conversion rights at least 15 days before end of 60-day conversion period. Employers must certify to this on the retirement application.

Go over working-after-retirement rulesWebpage for employeesWebpage for employers

• 60- or 180-day waiting periods• Prearrangements not allowed• No earnings limits • Retirees do not pay contributions

If employee is in a service purchase, have him or her contact KPERS as soon as possible

• If doing lump-sum, purchase has to be complete before last day on payroll • If doing payroll deduction, employee only gets credit for complete

quarters that were purchased

Complete retirement certification on the EWPQuick Vid: Certifications

Page 15: EMPLOYER MANAL - KPERS · Any +Any = 85 or more * two quarters round up to one year; 38 quarters round up to 10 years How to calculate 85 points (example) 1. Add employee’s age

Retirement Eligibility

Calculating Final Average Salary

Calculating Retirement Estimates

How to Retire

Retirement Date and End Date: Non-School

Retirement Date and End Date: School

Pay Reporting

Who Is a Licensed School Employee?

Retirement Payment Options

Certifications

Retirement Checklist

End Dates

Certifications

Cheat Sheet: Summer Retirements for Schools

15 8/19

GO TO kpers.org/employers INFOLINE 1-888-275-5737 EMAIL [email protected] KPERS 1 Retirement

CONTENTS

QUICK VIDS & MORE

EMPLOYER MANUALRetirement - KPERS 1

Avoid Common Problems

Ounce of Prevention

An Ounce of Prevention

Common Problems Preventions

An employee approaching retirement has never estimated his or her retirement benefit and is now worried

Remind the employee to use the Benefit Calculator and read his or her Member Annual Statement by accessing his or her online account.

Your employees often struggle getting through the retirement process.

Suggest to employees who are within five years of retirement, that they attend at least one Pre-Retirement Seminar and read the Pre-Retirement Planning Guide for (KPERS) or (KP&F).

You sent the application in, but haven’t heard back from KPERS.

Within about one week of receiving the application, KPERS will process it and put a To-Do on your EWP. If you don’t receive a notice within two weeks, call the infoline.